Australian insurer Suncorp has completed its 2027 core reinsurance renewals, providing catastrophe cover for losses of A$500 million to A$6.4 billion, in addition to its previously announced five-year total reinsurance arrangement providing A$800 million in annual cover, providing up to A$2.4 billion in cover over that period.
Despite continued weakness in catastrophe reinsurance, Suncorp expects total reinsurance costs in FY27 to be higher than last year, reflecting the inclusion of total reinsurance coverage and growth in risk exposures partially offset by improved pricing.
The top end of the main cat program increased by $100 million in FY27 compared with FY26, when Suncorp cut the top of the program from $6.75 billion the previous year.
Suncorp’s primary catastrophe plan covers residential, automotive and commercial property portfolios in Australia and New Zealand, with a maximum event reserve of $350 million for the first and second major events.
The insurer confirmed that structured multi-year reinsurance arrangements put in place in July 2025 remain in effect, providing protection for losses of $350 million to $500 million related to the first and second major events.
Additionally, for games three and four, group losses recouped losses between $350 million and $500 million. When combined with pull-down coverage as part of total reinsurance, Australia’s third and fourth event retention is reduced to $150 million.
New Zealand buyout coverage also remains unchanged through gross reinsurance coverage, providing protection of NZ$200 million and the group’s largest event retention.
As we reported in April, Suncorp’s five-year total reinsurance coverage is expected to effectively limit natural catastrophe costs at the point of attachment about 90% of the time in any given year.
In addition to details of its key catastrophe reinsurance, Suncorp also reiterated its natural catastrophe allowance (NHA) for FY27 at $1.8 billion, excluding claims handling charges and profit commissions. Total coverage is expected to limit natural catastrophe costs to $1.85 billion in FY27, approximately 90% of the time.
Suncorp acting chief executive Jeremy Robson said the renewal reflected continued discipline in the group’s reinsurance strategy, maintaining the right balance between costs, earnings volatility and capital efficiency.
He commented: “The reinsurance program for FY27 demonstrates our focus on optimizing returns while ensuring appropriate protection for customers and shareholders. While reinsurance costs remain an important factor in insurance pricing, it is pleasing that pricing across our comprehensive range of major catastrophe programs reflects improving market conditions, with overall protection now added to further enhance resilience and reduce volatility.”
